Launch HN: Hexel (YC W18) – Create a cryptocurrency for your community
Cryptocurrency is still in a very experimental phase, but most cryptocurrencies out there seem aimed at a serious, large-scale technical problem (not to mention the get-rich-quick schemes). We're helping people create currencies for interesting things they actually want to try using now.
So far, we've seen some cool use cases. To name a few: A gaming streamer is rewarding his most loyal viewers with tokens they can redeem for shoutouts or merchandise. A hip hop website is giving tokens to content curators and using them for giveaways. A few Discord channels have created tokens to use as a form of upvotes in their communities (and we think this could be cool for subreddits too).
We also provide tools for managing and tracking the token you make. This is free, but we plan to make money by charging for advanced features in the future. Right now on Hexel, you can do the following:
1.) Mint tokens and airdrop them to anyone with an Ethereum address
2.) Share a public page for your token, with information and a UI for sending that token to others
3.) Explore other tokens created on Hexel, subscribe to the ones you like, and request tokens from the creator
4.) Message your token's subscribers with updates or info about things you're doing with your token
5.) View a feed of payments made using your token
Although the ICO bandwagon and hype have left many people feeling cynical about cryptocurrencies (we feel that way ourselves), we're optimistic that there are many more potential applications and cool use cases out there. Our goal is to widen the space, make it interesting again, and make other use cases easy to explore. We'd love for anyone to poke holes in the use cases you see on the site, and even better would be feedback on use cases were you think this could be really useful. Thanks so much for any ideas you have!
Thanks! John & Marcus
140 comments
[ 8.8 ms ] story [ 260 ms ] threadHow long have both of you been working on this project?
What was your traction before getting into YC?
I'm most interested in the traction part since there's this misconception that YC does not accept early stage companies. It looks there are a whole lot of companies in the very early stage and I personally take that as a positive sign.
However, there is a protocol for decentralized exchanged called 0x. Any tokens on Ethereum can be traded on this protocol, using websites like Radar Relay.
I notice that the pricing model currently only features a free option. Wondering if you might be able to tell us more about the business model long term?
Many thanks
www.dotcomco.in
Some of the in-house community cryptocoins I made as a portfolio of examples include:
www.ycco.in - distributed karma for HN community (still up)
www.instagramco.in and www.facebookco.in - distributed likes
Of course I didn’t make it to front page of HN and got no traction. As I have more than a few cryptocoin/blockchain themed domains I began tozenizing the domain ownership rights to try to sell with the pre-made community cryptocoin, my experience is there seems to be more interest in these domains than the community coins.
When I launched bitcoin wasn’t worth what it is today...that said what would you pay for your own community cryptocoin anyway?
My parents own a gift shop (like a Hallmark). Can you give me an idea of how their business could be "tokenized"?
* Distribute tokens to partners (product / gift manufacturers). Partners with vested interest in the success of a company could be much less likely to sever relations as it will hurt their investment.
* Distribute tokens to customers as a type of rebate. Like a loyalty program that encourages patronship.
* Use tokens to vote on what products should be sold. Many gift shops sell pipes and other drug related items. This decision would sink other family oriented shops. What would your customers like?
* Distribute tokens to the locals as an attempt to build virility and community around your shop.
* Distribute tokens to employees as a way to recognize accomplishments. Ever get a few bonus stock from your company for doing good work over the week? Me neither.
* Sell tokens to raise funds.
* Set budgets based on community votes.
The list is endless and these are rough ideas. Look for ways to align business interests and customer interests.
Many also have existing solutions that are well-understood (e.g. loyalty programs tied to phone numbers).
And, what happens when every business has its own tokens? Who wants to track/manage all of that? Seems like a recipe for token fatigue.
>Look for ways to align business interests and customer interests.
In general, seems like token advocates look for ways to wedge a token into an interaction. Not saying there are no use cases, but there's a lot of "solution looking for a problem" happening.
What are we here for if not to share in the risk and success of the endeavours we support?
The token doesn't de facto inherit the value of the business. That would only be true to the extent that the token represents a claim on assets or profits or other tangible benefit; in other words when the token acts like a security, in which case we have already solved that. There is also a co-op model that exists and conveys some of this benefit.
I don't know what a token adds to these scenarios, and in fact are not even legal in the US to act as securities unless the buyers are accredited (most people are not). Sure, until recently, the token has made it easier to skirt non-accredited investor status and other regulatory matters, but it doesn't make it legal or a better solution and, in any case, the SEC is moving in on that.
I appreciate the spirit of what you're saying, and want it to be true. It's just not currently the case.
The tokens must be valuable but that will be shaped by the market forces. I'd love to buy some of the potential profit in my local coffee shop but I won't buy if it's backed by nothing.
> * Distribute tokens to partners (product / gift manufacturers). Partners with vested interest in the success of a company could be much less likely to sever relations as it will hurt their investment.
= stock or partial ownership.
> * Distribute tokens to customers as a type of rebate. Like a loyalty program that encourages patronship.
= rebates.
> * Use tokens to vote on what products should be sold. Many gift shops sell pipes and other drug related items. This decision would sink other family oriented shops. What would your customers like?
= surveys.
> * Distribute tokens to the locals as an attempt to build virility and community around your shop.
= flyers, ads, etc.
> * Distribute tokens to employees as a way to recognize accomplishments. Ever get a few bonus stock from your company for doing good work over the week? Me neither.
= bonuses/stock options
> * Sell tokens to raise funds.
= IPOs or kickstarters.
> * Set budgets based on community votes.
= surveys
Literally everything you've listed is a solved problem.
The only thing on here that might benefit from being a cryptocoin is the rebates idea: that's because rebates depend on some customers not cashing in their rebate. So if you make it harder to cash in your rebates by using a worse technology which is hard to use like cryptocoins, fewer users will cash in their rebates. However, this is a sleazy business practice, and if capitalism works as it should, sleazy companies offering rebates in the hope that people won't claim them should go out of business, so hopefully this would result in bad publicity and this business strategy would backfire.
* Hiring based on votes from stakeholders
* Choosing what events are held when through voting or burning (scheduling)
* Continuous community airdrops to encourage repeat visits
* Pairing with other local companies to cross airdrop for promotional purposes.
* Charging artists to hang paintings in the tokenized asset (encouraging patron art).
Tokenization can become a customizable base level component. Kind of like a webite.
I appreciate your skepticism but I do encourage you to rethink your stance.
Why not just skip all that nonsense and build a token? It's an easier abstraction and does not involve asking permission or trusting a third party.
Not only is this a solution in search of a problem, it's a solution which hasn't found a problem, and is being shoehorned onto problems it actually exacerbates. If you're running a business, the last thing you want is for your business' systems to be decentralized, because that means you don't have control over them. There's literally only downsides for the business.
Edit:
> We've submitted your transaction to the network. This usually takes about 2 minutes to confirm.
30 minutes later...
Edit 2:
One email to the Hexel support team later and lo, my token is live: https://www.onhexel.com/token/e4a37f4f-3a26-4ae3-a8b2-c932aa...
5/7 would recommend
Edit: transaction time depends on the gas price, email me at support@onhexel.com and I can make sure that things go smoothly!
Unless these are not really tokens and the "user/owner" can send the tokens without a centralized permission.
One more question: since these tokens are created on ETH, does this mean for each transaction related to a token, I will need to pay gas each time I want to transact?
What's the actual difference between this and an Ethereum token? Except you don't need to pay for the Google Sheet, of course.
So how is having a useless token balance recorded on Ethereum any different from having one recorded on a Google Sheet?
And your opinion is my opinion. It's not a good idea because it is not free.
You could create anything worthless that would mean "the token", and that would be enough.
You could use PGP keys if you want it to be private and to run.
Unless you can give a reason why those examples require decentralisation then, as much as I respect your attempt at finding an actual use for decentralised Merkel trees, I ultimately think it’s doomed to failure.
I'm actually interested if you can think of a reason too. This is an incredibly difficult brainstorming exercise. So many ICO's have failed to justify their use-cases, but tokens are so interesting that I have to believe there are good reasons to use them. Is there any case that you do find particularly helpful?
This is absolutely not true. Gas prices have been floating between 1 and 4 gwei for a while now. An erc20 token tx may cost 150k gas so between .00015 and .0006 ETH per tx. So that's $0.09 to $0.37. A simple ETH tx is 25k gas so about a 1/6 of this. You can check ethgasstation.info for the latest standard and "safe low" gas prices.
An Ethereum-based alternative would lose that aspect while also costing money and being very slow. I can’t imagine paying for what is effectively negative value.
The test for blockchain “dApps” is this: is someone so desperate to have thing X decentralized that they’ll pay for it in both real money and usability inconvenience? If so, it’s a dApp candidate.
In the real world, the only thing that seems to pass this test is some types of inter-company ledgers.
I just wanted to highlight the difference and that that HN is not free. It's free as in beer.
As far as inconvenience goes, it's temporary. Give it some time (2-5 years, I'd say) and it's only going to be about paying real money for it.
And if you think that EOS is decentralized, and that it will ever see the light of day, then even paying money won't be a thing for the users as they have a different business model for dApps, where the dApp owner has to stake EOS coins to get a share of EOS network's resources. Which is more similar to existing business model of renting EC2 servers
https://docs.google.com/forms/d/e/1FAIpQLSdlnBsw1iRAks1F2pD6...
A similar initiative is POA Network, which has US public notaries acting as trusted validators for an Ethereum sidechain:
https://poa.network
The troubling case is the company hosting the DB shutting down, and therefore the entire system becoming worthless. This is what prevents you as the customer from trusting such a system.
Surely you can see there are some advantages of blockchain based tech then?
I would somehow think that the database technology is quite secondary to the creditworthiness of the gaming streamer when people decide whether to trust or not a token system of a gaming streamer.
As an issuer, you do not have to worry about Hexel dissapearing. Presumably, the website doesn't make this clear.
The Hexel model doesn't seem to fix that. The issuer could still disappear, leaving the end user with a bunch of Hexel-tokens that can't be used anywhere.
For bonus point sight the backups with a PGP key and issue sha-256 checksums of your database (itself already containing previous checksums) this way you can call it a blockchain and get all the hype for free.
I don't say that the blockchain is useless, but it's hard to come up with use cases where it's clearly superior than databases.
Also, your comment reminds me somewhat of the infamous Hacker News comment when Dropbox posted ("everything you want to do can be done simply with rsync"). Sure, perhaps it's simple for tech folks that know how to build a database and a website that lets you mint and share tokens. But what if you are a popular Youtube vlogger? You either don't know how to do that, don't have time to, or don't want to spend the money. But perhaps you'd use this service, quickly mint tokens, give them away to users, and invent interesting use cases for them.
Personally, I love this idea and think it has great potential. Will anything useful come of it? Who knows -- it's early days. I think the most interesting use cases, if they exist, haven't been thought of yet. I look forward to seeing what people do with it.
- Is the idea interesting ? Yes possibly. The idea of making it easy to create tokens is interesting. I can see twitch streamers giving away tokens to their subscribers / viewers.
- Does it need to be on blockchain ? For all the use cases described, the answer according to me is no. It is easier to simply have a frontend through which users can interact vs maintaining a wallet, installing metamask, etc. This is going in the direction opposite of the Dropbox example - making things harder for users.
“Let me compare bitcoin / blockchain doubters to all doubters of some successful technology“. The fact that there were naysayers for some successful tech does not prove that there being naysayers for bitcoin/blockchain means that it will be a success.
Your reply is identical to every scammer and crooked shyster in the crypto space. YCombinator is damaging it’s brand associating with scams.
The sooner this blockchain nonsense crashes, the better...
https://en.wikipedia.org/wiki/Complementary_currency
There's no need for a blockchain, or distributed stuff, etc. The only thing you need is to convince people to accept it. You might as well make an app that transfers balance between rows on a database. And the reason why you never heard of complementary currency before, is that it's something done "just because you can" and has no real advantages.
I understand that none of the things I said are specific to you. But am I wrong?
There's also no dependency or trust on hexel per se once the coin is created. They can disappear, but the contract/token lives on.
Definitely upside for using Ether, but comes at a price in transaction time and money.
The cool think about tokens is that they can be programmed to behave different ways. Can you imagine a world where each currency is programmed differently? For example, maybe one currency gets deflated with each transaction (gets multipled by 0.9), and another currency can only be sent a certain number of times before it disappears, encourage people to hold it. Can you think of use cases where that changes the utility of a complementary currency? I'm asking because I can think of a few, but it's so hard to tell whether or not they're good ideas.
The second part, outside of that, is that tokens are on a blockchain. Again, none of this is specific to us, but there are a few properties that any token gets. Namely: They are provably scarce, they can interact with smart contracts, and they can be traded for other currencies if necessary.
https://www.onhexel.com/token/bb571299-e19a-4671-9036-7b3e73...
(not a hexel coin, but another ERC20)
Also, what are the smart contracts you use or security features that you have and can it be audited or is it a trade secret ?
Have you looked at other private ledger technologies and what do you think of those ?
Right now we have a single token contract that has been audited. We also have a few other smart contracts in the works, to be used with your token.
By private ledger, do you mean private blockchains? I’ve always been less interested in those. Part of the fun in blockchains is the public nature of them, and how they enable transparency and interaction between everyone. To me, private blockchains seem like they should just be databases in most cases. But I’m not an expert in that area by any means.
Meta: This is also a very well written announcement post, IMO, and I suggest anyone looking to launch something learn from it. It starts off with the most important soundbites up front, including the rather weird sounding "it's supposed to be fun". Then it gives a bit of backstory, but most importantly, provides interesting examples that back up the weird "fun" assertion.
It ends with a pretty clear explanation of what this costs and what the business model is.
All in all, great job. Good luck!
1. What's to stop a competitor from copying your app feature for feature and implementing their own features faster than you can keep up because they're using established distributed ledger technologies instead of blockchain?
2. Are there any features you have planned that make use of the one thing that differentiates blockchains from distributed ledgers (decentralization)?
The first immediate feature of using a blockchain is that token holders do not need to worry about a private distributed ledger shutting down its service. A future feature we have planned is a developer program where anyone can submit smart contracts that do interesting things with tokens. For this to work with a distributed ledger you would need to implement your own public API for interacting with your ledger.